“The tax system must reduce inequality”

Prime Minister Mishustin spoke about future fiscal reform

Modernization of the tax system should lead to a more equitable distribution of the fiscal burden. Prime Minister Mikhail Mishustin stated this when delivering a report to the State Duma. According to the head of government, this will reduce taxes for families with children and stimulate businesses to invest in development. As a result, the reform should help reduce inequality, the prime minister emphasized.

“It is important to take into account every detail. After all, the tax system should not only ensure the flow of resources to solve national and regional problems. It is designed to reduce inequality. And not only in society, but also in the socio-economic development of the constituent entities of the Russian Federation,” said Mikhail Mishustin.

Let us recall that before the presidential elections, in his address to the Federal Assembly, Vladimir Putin promised Russians to make the distribution of the tax burden more equitable. Chief researcher at the Institute of Economics of the Russian Academy of Sciences, Doctor of Economics Igor Nikolaev interpreted this proposal as follows: “The point is that the rich should pay more. How it will work out is another matter. It is advisable for the very poor to pay the minimum or not pay at all.” According to the expert, this approach corresponds to the concepts of “fairness” and “reduction of inequality” that the prime minister used. “Such concepts throughout the world, in fact, are being implemented with the introduction of a progressive tax scale,” the economist added.

It is not yet known which steps will be allocated in the future progressive scale and how many there will be. In his speech in the State Duma, Mishustin did not touch on details – perhaps that’s why. That they are still under development by government departments. But Igor Nikolaev, in his commentary for MK, emphasized the importance of not only raising taxes for the rich, but also sharply lowering them or completely eliminating them for low-income segments of the population.

“In this case, a progressive tax scale will be logical and complete. In this case, the state not only increases taxes for those who earn more than a certain amount, but also removes them for those who earn very little, below the subsistence level, which now amounts to about 20 thousand rubles per month. It is clear that it is difficult to live on that kind of money even without taxes,” the expert concludes.